Teekay Offshore Partners has entered into an agreement with Norway’s Statoil to provide a Floating Storage and Offtake (FSO) vessel for the operator’s Gina Krog (formerly Dagny) oil and gas field in the Norwegian North Sea.

The contract will be serviced by a new FSO unit converted from a 1995-built shuttle tanker, Randgrid, which is currently 67% owned by Teekay Offshore. The partnership’s portion of the FSO conversion project is expected to be completed for a total net capital cost of approximately US $220m, including the cost of acquiring the remaining 33% ownership interest in the tanker.